<div class="phx-topic abstract-wrapper">Investment in the infrastructure portion of the American Jobs Plan is a generational opportunity to tap into the US’s competitive nature and showcase its world-class engineering capabilities to better compete with China. </div>

Investment in the infrastructure portion of the American Jobs Plan is a generational opportunity to tap into the US’s competitive nature and showcase its world-class engineering capabilities to better compete with China.

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<div class="phx-topic">In May 1884, P.T. Barnum led a procession of 24 elephants and 17 camels across the newly constructed Brooklyn Bridge. He did it to prove to a nervous public that John Roebling’s masterfully designed suspension bridge was safe to use. Today, a century and a half later, how many crumbling bridges in the United States would Barnum and his elephants be willing to cross to prove the same point?Infrastructure has always been at the core of the US's mobility and competitive might. Our roads, bridges, ports, and railways have enabled our retail supply chains, facilitated our travel, and strengthened our national security. So how could something so critical to the American way of life be found in such disrepair? How did the United States, the largest economy in the world, find itself at the mercy of Third World mobility? How did we become so complacent over the years while China rose to become the gold standard for world-class infrastructure and engineering? The rise of China over the last two and a half decades has been one of the great achievements in human history, with over 200 million people being lifted out of poverty as a result. Today, China boasts one of the most modern and dynamic infrastructure systems on Earth. It has constructed over 20,000 miles of high-speed passenger rail and more than 200,000 miles of roads and bridges. It operates 7 of the world’s top 10 seaports, and has the world’s largest 5G network. China isn't just developing world-class infrastructure, it is exporting it as well, to countries such as Pakistan, Bangladesh, and other countries deemed strategically important to its Belt and Road Initiative. Part of China’s success has been due to its one-party socialist system, which allows it to accelerate grand construction projects without regard for cost or societal impact. That’s a road that open and free societies would never choose to take. The other part of China’s success has been due to its mindset regarding investment, time horizons, and global competition. We can learn from these are areas. <h2>A willingness to invest</h2>One of the reasons for China’s success with infrastructure has been its willingness to aggressively invest — spending over 6 percent of its GDP annually on infrastructure compared with just 2.4 percent in the United States. China plans to invest $1.4 trillion on digital infrastructure alone during the next five years, recognizing the role that artificial intelligence and the internet of things will play in managing traffic patterns and enabling predictive maintenance on roads and bridges. Meanwhile, here at home, the US is currently ranked 13th in the world for infrastructure quality and eighthin the world for broadband internet coverage. The American Society of Civil Engineers estimates that over the last 10 years, the US has underspent on infrastructure by as much as $2.59 trillion.<h2>Taking the 'long view'</h2>The second reason for China’s success is that it takes the long view on geopolitical issues, national infrastructure development, and economic growth strategy. During President Richard Nixon’s visit to China in 1972, he asked China’s Premier Zhou for his thoughts on the French Revolution and its impact on Western civilization. Zhou reportedly told Nixon that he thought it was still too early to say. To successfully compete with China on infrastructure in the 21st century, we’ll need to think, plan, and execute beyond presidential elections and the daily news cycle. We’ll need to take a more visionary approach to infrastructure, understanding that development takes time, planning, and cooperation. We’ll need to embrace the fact that what we build today is for the wellbeing of future generations and not just our own. We’ll need to take the long view. <h2>Competitive advantage in global marketplace</h2>The third reason for China’s success is that it views its national infrastructure and its Belt and Road Initiative as a competitive advantage in the global marketplace. By taking this view, China possesses a nationalistic sense of urgency to invest, develop, and export world-class infrastructure as quickly as possible. China views its domestic infrastructure as part of an international competitive strategy. To compete with China in the years ahead, the US must adopt a similar view on competitiveness with a comparable sense of urgency. The Biden Administration last week introduced a $2.3 trillion American Jobs Plan to address, among other things, the decrepit state of our own national infrastructure. The plan is aggressive to say the least, and seeks to address a number of unrelated problems that have been neglected for far too long. A small portion of the plan specifically addresses infrastructure and is a call to action to improve our roads, bridges, passenger rail, and ports to better the US’s domestic mobility and global competitiveness. President John Kennedy once said, “the time to repair the roof is when the sun is shining.” The infrastructure portion of the American Jobs Plan is an urgently needed initiative whose time has come. Interest rates are low, the unemployed need work, and in the post-COVID-19 world, the country would benefit from the additional economic stimulus. The Congressional Budget Office estimates that every dollar spent on infrastructure brings an economic benefit of $2.20. The US Council of Economic Advisors calculates that every $1 billion of transportation infrastructure investment ends up supporting 13,000 jobs, according to consultancy McKinsey and Company.Prioritizing the numerous components of the full American Jobs Plan will be a monumental task to navigate. The plan has four spending buckets, three of which have nothing to do with what we think of as transport infrastructure.Building schools and senior care facilities represents the largest bucket with a proposed spend of $768 billion or 33% of the total plan. Transportation is second-largest bucket with a proposed $621 billion spend or 27% of the plan. Utilities, jobs, manufacturing, and innovation make up the third and fourth buckets with a combined spend of $904 billion or 40 percent of the plan. The sheer size and complexity of the American Jobs Plan in its entirety will make it extremely difficult to legislate. <h2>Focused approach will yield progress</h2>A more focused and simplified approach is needed with infrastructure in order to make progress where it is needed most. One idea is to break out the $621 billion transportation infrastructure piece from the plan, combine it with the $100 billion broadband piece of the plan, and pass a bipartisan transportation infrastructure package as a first priority. This idea makes sense. Raising the federal gas tax has also been suggested. It’s been at 18.4 cents for more than two decades. The gas tax, though, has diminishing returns. Motor vehicles today are much more fuel efficient than when the tax was first introduced, and gas-powered vehicles will eventually be replaced by electric ones. In the future, we shouldn’t need elephants and camels to prove that our infrastructure is safe and world class. Investment in the infrastructure portion of the American Jobs Plan is a generational opportunity to tap into our competitive nature, showcase our world-class engineering capabilities, and do great things. To compete with China in the 21st century, we can’t afford to wait any longer. Peter Levesque is the president of Ports America, the largest marine terminal operator in the United States. He is past chairman of the American Chamber of Commerce in Hong Kong where he lived and worked for over 25 years. He is currently a director at the US Chamber of Commerce’s Board in Washington, D.C.</div>

In May 1884, P.T. Barnum led a procession of 24 elephants and 17 camels across the newly constructed Brooklyn Bridge. He did it to prove to a nervous public that John Roebling’s masterfully designed suspension bridge was safe to use. Today, a century and a half later, how many crumbling bridges in the United States would Barnum and his elephants be willing to cross to prove the same point? Infrastructure has always been at the core of the US's mobility and competitive might. Our roads, bridges, ports, and railways have enabled our retail supply chains, facilitated our travel, and strengthened our national security. So how could something so critical to the American way of life be found in such disrepair? How did the United States, the largest economy in the world, find itself at the mercy of Third World mobility? How did we become so complacent over the years while China rose to become the gold standard for world-class infrastructure and engineering? The rise of China over the last two and a half decades has been one of the great achievements in human history, with over 200 million people being lifted out of poverty as a result. Today, China boasts one of the most modern and dynamic infrastructure systems on Earth. It has constructed over 20,000 miles of high-speed passenger rail and more than 200,000 miles of roads and bridges. It operates 7 of the world’s top 10 seaports, and has the world’s largest 5G network. China isn't just developing world-class infrastructure, it is exporting it as well, to countries such as Pakistan, Bangladesh, and other countries deemed strategically important to its Belt and Road Initiative. Part of China’s success has been due to its one-party socialist system, which allows it to accelerate grand construction projects without regard for cost or societal impact. That’s a road that open and free societies would never choose to take. The other part of China’s success has been due to its mindset regarding investment, time horizons, and global competition. We can learn from these are areas. A willingness to invest One of the reasons for China’s success with infrastructure has been its willingness to aggressively invest — spending over 6 percent of its GDP annually on infrastructure compared with just 2.4 percent in the United States. China plans to invest $1.4 trillion on digital infrastructure alone during the next five years, recognizing the role that artificial intelligence and the internet of things will play in managing traffic patterns and enabling predictive maintenance on roads and bridges. Meanwhile, here at home, the US is currently ranked 13th in the world for infrastructure quality and eighthin the world for broadband internet coverage. The American Society of Civil Engineers estimates that over the last 10 years, the US has underspent on infrastructure by as much as $2.59 trillion. Taking the 'long view' The second reason for China’s success is that it takes the long view on geopolitical issues, national infrastructure development, and economic growth strategy. During President Richard Nixon’s visit to China in 1972, he asked China’s Premier Zhou for his thoughts on the French Revolution and its impact on Western civilization. Zhou reportedly told Nixon that he thought it was still too early to say. To successfully compete with China on infrastructure in the 21st century, we’ll need to think, plan, and execute beyond presidential elections and the daily news cycle. We’ll need to take a more visionary approach to infrastructure, understanding that development takes time, planning, and cooperation. We’ll need to embrace the fact that what we build today is for the wellbeing of future generations and not just our own. We’ll need to take the long view. Competitive advantage in global marketplace The third reason for China’s success is that it views its national infrastructure and its Belt and Road Initiative as a competitive advantage in the global marketplace. By taking this view, China possesses a nationalistic sense of urgency to invest, develop, and export world-class infrastructure as quickly as possible. China views its domestic infrastructure as part of an international competitive strategy. To compete with China in the years ahead, the US must adopt a similar view on competitiveness with a comparable sense of urgency. The Biden Administration last week introduced a $2.3 trillion American Jobs Plan to address, among other things, the decrepit state of our own national infrastructure. The plan is aggressive to say the least, and seeks to address a number of unrelated problems that have been neglected for far too long. A small portion of the plan specifically addresses infrastructure and is a call to action to improve our roads, bridges, passenger rail, and ports to better the US’s domestic mobility and global competitiveness. President John Kennedy once said, “the time to repair the roof is when the sun is shining.” The infrastructure portion of the American Jobs Plan is an urgently needed initiative whose time has come. Interest rates are low, the unemployed need work, and in the post-COVID-19 world, the country would benefit from the additional economic stimulus. The Congressional Budget Office estimates that every dollar spent on infrastructure brings an economic benefit of $2.20. The US Council of Economic Advisors calculates that every $1 billion of transportation infrastructure investment ends up supporting 13,000 jobs, according to consultancy McKinsey and Company. Prioritizing the numerous components of the full American Jobs Plan will be a monumental task to navigate. The plan has four spending buckets, three of which have nothing to do with what we think of as transport infrastructure. Building schools and senior care facilities represents the largest bucket with a proposed spend of $768 billion or 33% of the total plan. Transportation is second-largest bucket with a proposed $621 billion spend or 27% of the plan. Utilities, jobs, manufacturing, and innovation make up the third and fourth buckets with a combined spend of $904 billion or 40 percent of the plan. The sheer size and complexity of the American Jobs Plan in its entirety will make it extremely difficult to legislate. Focused approach will yield progress A more focused and simplified approach is needed with infrastructure in order to make progress where it is needed most. One idea is to break out the $621 billion transportation infrastructure piece from the plan, combine it with the $100 billion broadband piece of the plan, and pass a bipartisan transportation infrastructure package as a first priority. This idea makes sense. Raising the federal gas tax has also been suggested. It’s been at 18.4 cents for more than two decades. The gas tax, though, has diminishing returns. Motor vehicles today are much more fuel efficient than when the tax was first introduced, and gas-powered vehicles will eventually be replaced by electric ones. In the future, we shouldn’t need elephants and camels to prove that our infrastructure is safe and world class. Investment in the infrastructure portion of the American Jobs Plan is a generational opportunity to tap into our competitive nature, showcase our world-class engineering capabilities, and do great things. To compete with China in the 21st century, we can’t afford to wait any longer. Peter Levesque is the president of Ports America, the largest marine terminal operator in the United States. He is past chairman of the American Chamber of Commerce in Hong Kong where he lived and worked for over 25 years. He is currently a director at the US Chamber of Commerce’s Board in Washington, D.C.

Port News

Stronger US freight infrastructure needed to compete with China

<div class="phx-topic abstract-wrapper">The National Association of Waterfront Employers has sent a letter to the Senate Appropriations Committee asking for continued support of the $3 billion Clean Ports Program.</div>

The National Association of Waterfront Employers has sent a letter to the Senate Appropriations Committee asking for continued support of the $3 billion Clean Ports Program.

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<div class="phx-topic">US ports are worried that potential cuts to the Environmental Protection Agency’s (EPA’s) 2026 budget will make it more difficult to phase out diesel-powered yard equipment and are urging Congress to maintain grant programs meant to reduce carbon emissions from their operations. The National Association of Waterfront Employers (NAWE) sent a letter to the Senate Appropriations Committee on Monday asking for continued support of the Clean Ports Program, a $3 billion grant program funded under the 2022 Inflation Reduction Act. NAWE President Carl Bentzel said in the letter the grants help US ports invest in newer, more efficient yard equipment and allow them to handle more volumes in limited space. “Ports are facing increasing demand and growing global competition while trying to operate with aging cargo-handling equipment, limited funding for capital improvement, and limitations on space for capital expansion,” Bentzel said. He added that US manufacturers benefit from more investments in clean ports projects, furthering the Trump administration’s agenda of boosting domestic industries. “Many of the Clean Port projects are reliant on US manufacturing of cargo handling equipment,” Bentzel wrote. “This equipment is not only driving a vital US manufacturing sector but will be a foundational industry for the revitalization of the US maritime industrial base.” <h3>EPA faces cuts </h3>The letter arrives as Congress takes up spending proposals that will likely include steep cuts to the EPA, which administers the Clean Ports Program. In May, EPA Administrator Lee Zeldin proposed a $4.2 billion budget for his agency for the next fiscal year, about half of what it received for 2025. House Republicans are working on a bill that would provide about $7 billion for the EPA, a 23% cut from 2025 spending. The Clean Ports Program awarded 54 grants in 2024. Almost all of the program’s grant funding went toward zero-emission port equipment, with a smaller portion funding other initiatives such as developing plans to reduce emissions. The Port Authority of New York and New Jersey <a href="https://www.joc.com/article/us-ports-plan-upgrades-to-electric-yard-equipment-after-securing-epa-grants-5782145">received the largest single grant</a>, $451 million, to replace diesel-powered yard equipment. The Port of Los Angeles received the second-largest award at $411 million. The long lead times for ordering and purchasing new yard equipment mean the grant monies have only trickled out. Of the $2.9 billion in grant awards, about $417,000 has been spent so far, according to USASpending.gov. Although there has not been any push for a rescission of the awards, which are already obligated by Congress, NAWE’s letter said the grant funding should “be spent as expeditiously as possible so that these important projects can move forward and have the intended impact on making the supply chain more efficient and safer.” Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

US ports are worried that potential cuts to the Environmental Protection Agency’s (EPA’s) 2026 budget will make it more difficult to phase out diesel-powered yard equipment and are urging Congress to maintain grant programs meant to reduce carbon emissions from their operations. The National Association of Waterfront Employers (NAWE) sent a letter to the Senate Appropriations Committee on Monday asking for continued support of the Clean Ports Program, a $3 billion grant program funded under the 2022 Inflation Reduction Act. NAWE President Carl Bentzel said in the letter the grants help US ports invest in newer, more efficient yard equipment and allow them to handle more volumes in limited space. “Ports are facing increasing demand and growing global competition while trying to operate with aging cargo-handling equipment, limited funding for capital improvement, and limitations on space for capital expansion,” Bentzel said. He added that US manufacturers benefit from more investments in clean ports projects, furthering the Trump administration’s agenda of boosting domestic industries. “Many of the Clean Port projects are reliant on US manufacturing of cargo handling equipment,” Bentzel wrote. “This equipment is not only driving a vital US manufacturing sector but will be a foundational industry for the revitalization of the US maritime industrial base.” EPA faces cuts The letter arrives as Congress takes up spending proposals that will likely include steep cuts to the EPA, which administers the Clean Ports Program. In May, EPA Administrator Lee Zeldin proposed a $4.2 billion budget for his agency for the next fiscal year, about half of what it received for 2025. House Republicans are working on a bill that would provide about $7 billion for the EPA, a 23% cut from 2025 spending. The Clean Ports Program awarded 54 grants in 2024. Almost all of the program’s grant funding went toward zero-emission port equipment, with a smaller portion funding other initiatives such as developing plans to reduce emissions. The Port Authority of New York and New Jersey received the largest single grant , $451 million, to replace diesel-powered yard equipment. The Port of Los Angeles received the second-largest award at $411 million. The long lead times for ordering and purchasing new yard equipment mean the grant monies have only trickled out. Of the $2.9 billion in grant awards, about $417,000 has been spent so far, according to USASpending.gov. Although there has not been any push for a rescission of the awards, which are already obligated by Congress, NAWE’s letter said the grant funding should “be spent as expeditiously as possible so that these important projects can move forward and have the intended impact on making the supply chain more efficient and safer.” Contact Michael Angell at michael.angell@spglobal.com .

Transport, Trade and Regulation News

Maritime

North American ports

Ports fear emissions grants under threat amid EPA budget slashing

<div class="phx-topic abstract-wrapper">A strong midterm global outlook for wind farm development could be dampened by a lack of forward ship capacity to service the buildouts.</div>

A strong midterm global outlook for wind farm development could be dampened by a lack of forward ship capacity to service the buildouts.

<div class="phx-topic">A looming shortage of vessels used for the development of offshore wind farms could delay projects even as global installed power capacity is forecast to surge 60% to 133 gigawatts (GW) by 2033 as markets develop, especially in Asia and Latin America, analysts say. The vessel capacity crunch will be exacerbated by a lack of new ships entering service and the shift to larger and heavier wind project components including turbines, blades and foundations, the analysts said. The coming vessel shortage is part of wider supply chain issues that threaten to derail offshore wind energy projects, they added. Highlighting the issue, Yvan Gelbart, lead analyst at Paris-headquartered maritime consultant Spinergie, told the Journal of Commerce that constrained supply of heavy-lift vessels could reduce the installation of bottom-fixed offshore wind turbines to about 112 GW, excluding China. He explained wind turbine installation vessels (WTIVs) handle foundation and turbine installations and undertake maintenance, so limited availability will create bottlenecks. “We project an average heavy-lift vessel capacity shortfall of roughly 10% between 2025 and 2030, peaking in 2029 and 2030, and continuing in the 2030s,” Gelbart said. He pointed out that most newbuild WTIVs were ordered in the early 2020s and there are now no new vessels on order for delivery from 2028. Spinergie is also not expecting any WTIV vessel orders to be placed with shipyards this year. “But heavy-lift vessel owners are cautious about investing in newbuilds,” Gelbart said. “Their strategy is aimed at avoiding oversupply, keeping day rates high, and avoiding high costs when financing newbuilds. Given the current financial context, this is not an ideal time for heavy investment in new vessels, though we may see increased ordering activity from 2026 onwards.” “As appetite for next generation turbines remains high, installation bottlenecks will intensify unless shipowners commit to newbuilds,” he added. This comes as the existing fleet is already under pressure — especially for ships able to install turbines of more than 15 MW — with vessel utilizations levels of 70% to 80% over the past four years. “This means this fleet is constantly working with little room to spare,” Gelbart said. “And with turbine sizes continuing to trend higher, this pressure will only increase.” <h3>Undersupply warning beginning 2028 </h3>Other specialists echoed Gelbart’s views, including Denmark’s Cadeler, owner of the world’s largest fleet of jack-up offshore wind installation vessels, which said there’s a significant reduction in the availability of vessels as turbines become bigger. “Undersupply [of vessels] will become particularly visible from 2028,” Cadeler CEO Mikkel Gleerup said during a first-quarter results presentation in May. “We also believe a lot of supply that is currently mapped as supplying the industry will in the coming years be gradually phased out because it will become much, much harder for them to compete efficiently in the industry,” Gleerup said. He added that these potentially obsolete vessels are currently operating in both foundation and wind turbine generator installation. That reflects the growing size and weight of offshore wind turbines that have trended upward from 9.5 MW machines with a tip height of 530 feet in 2020 to 26 MW and a height of 1,000 feet last year, according to the Global Wind Energy Council (GWEC). Each turbine is expected to increase in power to 35 MW and be 1,150 feet tall by 2030. Norway’s Rystad Energy forecasts a shortage of up to 10 ships capable of installing wind turbines of more than 10 MW in 2029, increasing to 20 in 2030, with the shortfall particularly acute in larger-capacity ships able to install turbines of more than 14 MW. Echoing this view, Gelbart said that while developers increasingly prefer larger turbines, “fewer than 20 vessels out of 85, including those due for delivery by 2028, currently have the capacity to install these larger turbines in the 18 MW and above segment, narrowing the effective fleet considerably.” Potential vessel shortages are just one supply chain challenge facing the offshore wind industry, according to GWEC. Others include a lack of port and dock facilities, lack of equipment standardization, delays in offshore and onshore grid development, and a lack of transmission infrastructure, according to panelists at a GWEC webinar on July 9. “Strengthening the supply chain is super critical,” Paul Trevillion, Singapore-based global director of renewables at French testing and inspection company Bureau Veritas, said during the webinar. <h3>Strong global outlook despite regional blips </h3>The midterm outlook for offshore wind development to about 2034 remains strong despite recent headwinds that include rising inflation, the pandemic-fueled recession, failed offshore development auctions and supply chain constraints, Zhou Feng, GWEC’s chief research officer, said during the webinar. While China and Europe are set to maintain their dominant position in offshore wind installation capacity, GWEC highlighted the growing importance of other countries and regions, especially Asia and Latin America. In Asia, 215 GW of offshore wind capacity is forecast to be added in the 10 years ending 2034, according to GWEC’s global offshore wind report published June 25. Mainland China, Taiwan, South Korea, Japan and the Philippines will become the top five markets for the installation of new capacity, the report said. In Japan, the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) has identified 50 fixed and floating offshore wind development sites as the country targets 10 GW of offshore wind capacity by 2030 and up to 45 GW by 2040. By comparison, Japan had just 253 MW of installed offshore wind capacity at the end of last year. South Korea is aiming for 14 GW of installed capacity by 2030, up from zero now, with 3.2 GW targeted from up to 10 wind farms in the South Jeolla province of the country’s southwest, the Ministry of Trade, Industry and Energy announced in April. The growing importance of these two countries was echoed by Cadeler’s Gleerup, who pointed out there is record-high tender activity in South Korea and Japan, while Australia is concluding its first auctions for new offshore wind projects. Vietnam and the Philippines are also markets set to take off, with sites totaling 65 GW recently awarded by the Philippines energy department, according to GWEC, which is advising countries on the development and auction process. In Latin America, GWEC highlighted Brazil and Colombia as key markets, with 103 projects totaling 244 GW seeking the environmental greenlight in Brazil and 69 areas being considered by Colombia’s mines and energy ministry for offshore wind development, the GWEC report said. Gleerup said despite projects in the US and Europe being delayed or stopped, globally “offshore wind is going from record to record.” “We are seeing stronger and stronger levels of projects being auctioned,” the Cadeler CEO said. “We are seeing more projects coming online.” Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>. </div>

A looming shortage of vessels used for the development of offshore wind farms could delay projects even as global installed power capacity is forecast to surge 60% to 133 gigawatts (GW) by 2033 as markets develop, especially in Asia and Latin America, analysts say. The vessel capacity crunch will be exacerbated by a lack of new ships entering service and the shift to larger and heavier wind project components including turbines, blades and foundations, the analysts said. The coming vessel shortage is part of wider supply chain issues that threaten to derail offshore wind energy projects, they added. Highlighting the issue, Yvan Gelbart, lead analyst at Paris-headquartered maritime consultant Spinergie, told the Journal of Commerce that constrained supply of heavy-lift vessels could reduce the installation of bottom-fixed offshore wind turbines to about 112 GW, excluding China. He explained wind turbine installation vessels (WTIVs) handle foundation and turbine installations and undertake maintenance, so limited availability will create bottlenecks. “We project an average heavy-lift vessel capacity shortfall of roughly 10% between 2025 and 2030, peaking in 2029 and 2030, and continuing in the 2030s,” Gelbart said. He pointed out that most newbuild WTIVs were ordered in the early 2020s and there are now no new vessels on order for delivery from 2028. Spinergie is also not expecting any WTIV vessel orders to be placed with shipyards this year. “But heavy-lift vessel owners are cautious about investing in newbuilds,” Gelbart said. “Their strategy is aimed at avoiding oversupply, keeping day rates high, and avoiding high costs when financing newbuilds. Given the current financial context, this is not an ideal time for heavy investment in new vessels, though we may see increased ordering activity from 2026 onwards.” “As appetite for next generation turbines remains high, installation bottlenecks will intensify unless shipowners commit to newbuilds,” he added. This comes as the existing fleet is already under pressure — especially for ships able to install turbines of more than 15 MW — with vessel utilizations levels of 70% to 80% over the past four years. “This means this fleet is constantly working with little room to spare,” Gelbart said. “And with turbine sizes continuing to trend higher, this pressure will only increase.” Undersupply warning beginning 2028 Other specialists echoed Gelbart’s views, including Denmark’s Cadeler, owner of the world’s largest fleet of jack-up offshore wind installation vessels, which said there’s a significant reduction in the availability of vessels as turbines become bigger. “Undersupply [of vessels] will become particularly visible from 2028,” Cadeler CEO Mikkel Gleerup said during a first-quarter results presentation in May. “We also believe a lot of supply that is currently mapped as supplying the industry will in the coming years be gradually phased out because it will become much, much harder for them to compete efficiently in the industry,” Gleerup said. He added that these potentially obsolete vessels are currently operating in both foundation and wind turbine generator installation. That reflects the growing size and weight of offshore wind turbines that have trended upward from 9.5 MW machines with a tip height of 530 feet in 2020 to 26 MW and a height of 1,000 feet last year, according to the Global Wind Energy Council (GWEC). Each turbine is expected to increase in power to 35 MW and be 1,150 feet tall by 2030. Norway’s Rystad Energy forecasts a shortage of up to 10 ships capable of installing wind turbines of more than 10 MW in 2029, increasing to 20 in 2030, with the shortfall particularly acute in larger-capacity ships able to install turbines of more than 14 MW. Echoing this view, Gelbart said that while developers increasingly prefer larger turbines, “fewer than 20 vessels out of 85, including those due for delivery by 2028, currently have the capacity to install these larger turbines in the 18 MW and above segment, narrowing the effective fleet considerably.” Potential vessel shortages are just one supply chain challenge facing the offshore wind industry, according to GWEC. Others include a lack of port and dock facilities, lack of equipment standardization, delays in offshore and onshore grid development, and a lack of transmission infrastructure, according to panelists at a GWEC webinar on July 9. “Strengthening the supply chain is super critical,” Paul Trevillion, Singapore-based global director of renewables at French testing and inspection company Bureau Veritas, said during the webinar. Strong global outlook despite regional blips The midterm outlook for offshore wind development to about 2034 remains strong despite recent headwinds that include rising inflation, the pandemic-fueled recession, failed offshore development auctions and supply chain constraints, Zhou Feng, GWEC’s chief research officer, said during the webinar. While China and Europe are set to maintain their dominant position in offshore wind installation capacity, GWEC highlighted the growing importance of other countries and regions, especially Asia and Latin America. In Asia, 215 GW of offshore wind capacity is forecast to be added in the 10 years ending 2034, according to GWEC’s global offshore wind report published June 25. Mainland China, Taiwan, South Korea, Japan and the Philippines will become the top five markets for the installation of new capacity, the report said. In Japan, the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) has identified 50 fixed and floating offshore wind development sites as the country targets 10 GW of offshore wind capacity by 2030 and up to 45 GW by 2040. By comparison, Japan had just 253 MW of installed offshore wind capacity at the end of last year. South Korea is aiming for 14 GW of installed capacity by 2030, up from zero now, with 3.2 GW targeted from up to 10 wind farms in the South Jeolla province of the country’s southwest, the Ministry of Trade, Industry and Energy announced in April. The growing importance of these two countries was echoed by Cadeler’s Gleerup, who pointed out there is record-high tender activity in South Korea and Japan, while Australia is concluding its first auctions for new offshore wind projects. Vietnam and the Philippines are also markets set to take off, with sites totaling 65 GW recently awarded by the Philippines energy department, according to GWEC, which is advising countries on the development and auction process. In Latin America, GWEC highlighted Brazil and Colombia as key markets, with 103 projects totaling 244 GW seeking the environmental greenlight in Brazil and 69 areas being considered by Colombia’s mines and energy ministry for offshore wind development, the GWEC report said. Gleerup said despite projects in the US and Europe being delayed or stopped, globally “offshore wind is going from record to record.” “We are seeing stronger and stronger levels of projects being auctioned,” the Cadeler CEO said. “We are seeing more projects coming online.” Contact Keith Wallis at keithwallis@hotmail.com .

Breakbulk News

Breakbulk carriers

Energy projects

Tightening vessel supply threatens to delay offshore wind projects

<div class="phx-topic abstract-wrapper">Container volumes handled by North Europe’s busiest port continue to grow, alongside the now critical need for more landside capacity. </div>

Container volumes handled by North Europe’s busiest port continue to grow, alongside the now critical need for more landside capacity.

<div class="phx-topic">Marine terminals in Antwerp-Bruges are under “heavy strain,” with strong container volume in the first half of the year exacerbating congestion from a shortage of landside space that is already at critically low levels, the Belgian hub port said Tuesday. First-half volume at Europe’s busiest container port increased 3.7% year over year to 6.91 million TEUs, driven by a continued surge in overall trade with the US that increased 17.2% to 16.4 million tons. “Our consistently strong trade relationship with the United States confirms our role as a trans-Atlantic gateway to Europe,” Jacques Vandermeiren, CEO of the Port of Antwerp-Bruges, said in a statement. “At the same time, current capacity pressures and operational challenges highlight the need for additional container infrastructure,” he added. “With the ECA [extra container capacity Antwerp] project, we are focused on building for the future so that we can continue to support sustainable growth.” The lack of space is just one of a daunting series of factors contributing to port congestion in the Belgian port — and to bottlenecks at several other hubs in North Europe — that were outlined by Antwerp-Bruges in its first-half operational update. “Container ship arrivals remain irregular due to disruptions dating back to the COVID crisis, further exacerbated by rerouting around the Cape of Good Hope to avoid the Red Sea,” the port’s statement noted. “The recent reshuffling of container alliances has temporarily led to simultaneous vessel calls and high cargo volumes,” it added. “Poor schedule reliability is complicating terminal planning: containers remain on site longer, and vessels are arriving with increasingly large loads.” The series of factors has driven up average dwell times to between seven and eight days compared with the usual five days, Antwerp noted, adding that overcrowded terminals required additional container movements, placing extra strain on personnel and equipment. With the port already under severe operational pressure, recent industrial action by national unions has added to the cargo-handling challenges. A nationwide strike in Belgium on May 20 brought vessel handling to a standstill, while another national “day of action” was held on June 25. Strong peak season demand is another factor that is piling pressure on congested terminals in North Europe and <a href="https://www.joc.com/article/ocean-carriers-adjust-calls-as-congestion-chokes-european-hubs-6037668">forcing carriers to divert some services</a> away from congested import gateways. There are also significant delays in Asia that impact the schedule reliability of carriers arriving in Europe, with bottlenecks in the key transshipment hub of Singapore. Port visibility data from Portcast on July 13 shows 35 container vessels were waiting to berth. <h3>Tariffs bring uncertainty to trans-Atlantic </h3>A standout trade lane for Antwerp is the trans-Atlantic, where traffic with the US has continued its first-quarter growth through the first half, although the impact of tariffs hangs over the corridor. “The outlook for the second half of 2025 remains uncertain,” the Antwerp-Bruges statement noted. “Much will depend on a potential trade agreement between the EU and the US by Aug. 1, which could restore greater certainty and predictability in the supply chain.” But the likelihood of a US-EU trade deal appears to be diminishing. President Donald Trump sent a letter to Brussels this week threatening to impose 30% blanket tariffs on European imports beginning Aug. 1, surprising EU officials who thought they were close to a preliminary agreement with the US. In response, Brussels is now readying a fresh list of American products to hit with retaliatory tariffs if a trade deal isn’t reached by the deadline. One of the sectors hardest hit by the US trade war is automotives. Vehicle exports via Antwerp to the US have seen a clear decline in the first half as tariffs dragged down the numbers. In the first six months of the year, 15.9% fewer new passenger cars and vans (76,089 units) and 31.5% fewer trucks and heavy vehicles (11,751 units) were exported, according to the port. Antwerp data shows European first-half imports from the US increased 13.1% year over year to 9.7 million tons, with higher volumes in containers and liquid bulk. Exports to the US rose 23.5% to 6.7 million tons, driven mainly by fuels and dry bulk. Antwerp container exports to the US remained stable at 303,000 TEUs, while container imports rose 12.6%. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Marine terminals in Antwerp-Bruges are under “heavy strain,” with strong container volume in the first half of the year exacerbating congestion from a shortage of landside space that is already at critically low levels, the Belgian hub port said Tuesday. First-half volume at Europe’s busiest container port increased 3.7% year over year to 6.91 million TEUs, driven by a continued surge in overall trade with the US that increased 17.2% to 16.4 million tons. “Our consistently strong trade relationship with the United States confirms our role as a trans-Atlantic gateway to Europe,” Jacques Vandermeiren, CEO of the Port of Antwerp-Bruges, said in a statement. “At the same time, current capacity pressures and operational challenges highlight the need for additional container infrastructure,” he added. “With the ECA [extra container capacity Antwerp] project, we are focused on building for the future so that we can continue to support sustainable growth.” The lack of space is just one of a daunting series of factors contributing to port congestion in the Belgian port — and to bottlenecks at several other hubs in North Europe — that were outlined by Antwerp-Bruges in its first-half operational update. “Container ship arrivals remain irregular due to disruptions dating back to the COVID crisis, further exacerbated by rerouting around the Cape of Good Hope to avoid the Red Sea,” the port’s statement noted. “The recent reshuffling of container alliances has temporarily led to simultaneous vessel calls and high cargo volumes,” it added. “Poor schedule reliability is complicating terminal planning: containers remain on site longer, and vessels are arriving with increasingly large loads.” The series of factors has driven up average dwell times to between seven and eight days compared with the usual five days, Antwerp noted, adding that overcrowded terminals required additional container movements, placing extra strain on personnel and equipment. With the port already under severe operational pressure, recent industrial action by national unions has added to the cargo-handling challenges. A nationwide strike in Belgium on May 20 brought vessel handling to a standstill, while another national “day of action” was held on June 25. Strong peak season demand is another factor that is piling pressure on congested terminals in North Europe and forcing carriers to divert some services away from congested import gateways. There are also significant delays in Asia that impact the schedule reliability of carriers arriving in Europe, with bottlenecks in the key transshipment hub of Singapore. Port visibility data from Portcast on July 13 shows 35 container vessels were waiting to berth. Tariffs bring uncertainty to trans-Atlantic A standout trade lane for Antwerp is the trans-Atlantic, where traffic with the US has continued its first-quarter growth through the first half, although the impact of tariffs hangs over the corridor. “The outlook for the second half of 2025 remains uncertain,” the Antwerp-Bruges statement noted. “Much will depend on a potential trade agreement between the EU and the US by Aug. 1, which could restore greater certainty and predictability in the supply chain.” But the likelihood of a US-EU trade deal appears to be diminishing. President Donald Trump sent a letter to Brussels this week threatening to impose 30% blanket tariffs on European imports beginning Aug. 1, surprising EU officials who thought they were close to a preliminary agreement with the US. In response, Brussels is now readying a fresh list of American products to hit with retaliatory tariffs if a trade deal isn’t reached by the deadline. One of the sectors hardest hit by the US trade war is automotives. Vehicle exports via Antwerp to the US have seen a clear decline in the first half as tariffs dragged down the numbers. In the first six months of the year, 15.9% fewer new passenger cars and vans (76,089 units) and 31.5% fewer trucks and heavy vehicles (11,751 units) were exported, according to the port. Antwerp data shows European first-half imports from the US increased 13.1% year over year to 9.7 million tons, with higher volumes in containers and liquid bulk. Exports to the US rose 23.5% to 6.7 million tons, driven mainly by fuels and dry bulk. Antwerp container exports to the US remained stable at 303,000 TEUs, while container imports rose 12.6%. Contact Greg Knowler at greg.knowler@spglobal.com .

Container Shipping News

Trans-Atlantic

International ports

Strong H1 volumes, space crunch keep Antwerp terminals under pressure

<div class="phx-topic abstract-wrapper">The infrastructure fund that owns the Port of New York and New Jersey’s largest marine terminal is not looking to divest as it seeks to extend the term of its lease, according to people familiar with the talks.</div>

The infrastructure fund that owns the Port of New York and New Jersey’s largest marine terminal is not looking to divest as it seeks to extend the term of its lease, according to people familiar with the talks.

<div class="phx-topic">Infrastructure investor Macquarie is looking to keep its majority stake in one of largest marine terminals on the US East Coast despite rumors of a sale that would coincide with a new lease at the Port of New York and New Jersey. Macquarie, though, faces millions in new costs under a new lease as the port seeks to offload wharf and berth maintenance onto its tenants. Macquarie Infrastructure Partners, <a href="https://www.joc.com/article/deutsche-bank-to-sell-maher-terminals-at-port-of-ny-nj-5230328">which bought New Jersey’s Maher Terminals in 2016 through its MIP III fund</a>, is negotiating with the Port Authority of the New York and New Jersey (PANYNJ) for a new lease, according to people familiar with the talks. Japanese shipping line NYK acquired a 20% stake in Maher from MIP III shortly after the initial acquisition, leaving Macquarie with a majority 80% stake. Macquarie’s current lease for Maher doesn’t expire until 2030. But talks on a renewal started earlier this year under the expectation that MIP III would have to sell Maher as part of a capital return to its investors after the fund’s initial 10-year time horizon, sources said. Nailing down a new lease, which could be up to 30 years, was considered necessary before a potential buyer would consider acquiring a long-term asset such as the marine terminal, they added. In 2023, <a href="https://www.joc.com/article/ssa-marine-looks-to-expand-into-new-us-ports-with-deal-for-ceres-5221078">MIP III sold one of its portfolio companies</a>, Ceres Terminals, to Carrix, which is the parent company of terminal operator SSA Marine and has financial backing from the infrastructure fund of private equity investor Blackstone. However, investors in MIP III, which is a 2013 vintage fund, have agreed to extend the fund’s time horizon for another 10 years, according to a person familiar with the fund’s operations. MIP III’s extended time horizon means there are no plans — at least in the near term — for a sale of Maher, the source said. MIP III’s extension also delays an informal deadline of mid-2025 that the PANYNJ sought for lease negotiations, although a lease extension is likely to be agreed on later this year. Macquarie and the PANYNJ declined to comment on lease negotiations. <h3>Rising maintenance costs </h3>Since the purchase of Maher, Macquarie has doubled down on US terminal assets, particularly on the US West Coast. In 2019, it bought the Long Beach Container Terminal from OOCL for $1.78 billion and a year later acquired Long Beach’s ITS terminal for an undisclosed sum. In 2023, it purchased significant ownership stakes in TraPac’s Los Angeles and Oakland terminals and in Yusen Terminals. At 450 acres and almost 2 million container lifts per year, Maher is Macquarie’s largest single terminal asset and the largest privately operated terminal on the US East Coast. Maher has served as the primary East Coast hub for carriers in the Ocean Alliance. One of those carriers, CMA CGM, has moved more of its vessel calls to <a href="https://www.joc.com/article/cma-cgm-adds-terminal-assets-in-new-yorknew-jersey-5217593">the two NY-NJ marine terminals that it bought in 2022</a>. However, CMA CGM’s terminals do not have the capacity to also handle other Ocean Alliance carriers, including Cosco Shipping, OOCL and Evergreen Marine. CMA CGM’s New Jersey terminal will have more space once a throughput agreement with carriers in the Premier Alliance expires in 2027. Even then, Maher would need to handle some Ocean Alliance vessels, people familiar with the matter say. In addition to Ocean Alliance, Maher handles independent services from Zim and other carriers. It also serves as swing capacity for Maersk and Mediterranean Shipping Co. <a href="https://www.joc.com/article/new-cranes-put-ny-nj-port-on-track-to-handle-more-ultra-large-ships-by-2025-5226275">amid ongoing capital projects at the two terminals that serve those carriers</a>. Maher’s talks with the PANYNJ come amid the bi-state agency’s focus on shifting costs for maintaining the port’s wharves and berths to terminal operators. While marine terminals have typically only been responsible for everything from the ground up, CMA CGM and APM Terminals, which signed a new lease in March, agreed to terms requiring them to cover costs of wharf and berth maintenance. Damage from a worm called a marine borer has rendered some of the pylons supporting the NY-NJ piers down to the diameter of a “<a href="https://www.northjersey.com/story/news/transportation/2023/12/08/tiny-shipworms-ravaging-wood-pilings-of-nj-ny-wharves-port-authority-newark-bay/71813583007/">toothpick</a>,” PANYNJ Port Director Bethann Rooney told local press. The additional maintenance responsibility on the part of tenants is lengthening Maher’s lease talks due to the costs involved. Repairing damaged wharves and other maintenance could add $20 million to a terminal operator’s annual costs under a long-term lease. The alternative is spending up to $250 million to fully replace a damaged berth. With each terminal having three or four big-ship berths, a terminal operator could face up to $1 billion in replacement costs. Moreover, any berth replacement would reduce capacity at the port, requiring terminals to coordinate such projects as they occur. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

Infrastructure investor Macquarie is looking to keep its majority stake in one of largest marine terminals on the US East Coast despite rumors of a sale that would coincide with a new lease at the Port of New York and New Jersey. Macquarie, though, faces millions in new costs under a new lease as the port seeks to offload wharf and berth maintenance onto its tenants. Macquarie Infrastructure Partners, which bought New Jersey’s Maher Terminals in 2016 through its MIP III fund , is negotiating with the Port Authority of the New York and New Jersey (PANYNJ) for a new lease, according to people familiar with the talks. Japanese shipping line NYK acquired a 20% stake in Maher from MIP III shortly after the initial acquisition, leaving Macquarie with a majority 80% stake. Macquarie’s current lease for Maher doesn’t expire until 2030. But talks on a renewal started earlier this year under the expectation that MIP III would have to sell Maher as part of a capital return to its investors after the fund’s initial 10-year time horizon, sources said. Nailing down a new lease, which could be up to 30 years, was considered necessary before a potential buyer would consider acquiring a long-term asset such as the marine terminal, they added. In 2023, MIP III sold one of its portfolio companies , Ceres Terminals, to Carrix, which is the parent company of terminal operator SSA Marine and has financial backing from the infrastructure fund of private equity investor Blackstone. However, investors in MIP III, which is a 2013 vintage fund, have agreed to extend the fund’s time horizon for another 10 years, according to a person familiar with the fund’s operations. MIP III’s extended time horizon means there are no plans — at least in the near term — for a sale of Maher, the source said. MIP III’s extension also delays an informal deadline of mid-2025 that the PANYNJ sought for lease negotiations, although a lease extension is likely to be agreed on later this year. Macquarie and the PANYNJ declined to comment on lease negotiations. Rising maintenance costs Since the purchase of Maher, Macquarie has doubled down on US terminal assets, particularly on the US West Coast. In 2019, it bought the Long Beach Container Terminal from OOCL for $1.78 billion and a year later acquired Long Beach’s ITS terminal for an undisclosed sum. In 2023, it purchased significant ownership stakes in TraPac’s Los Angeles and Oakland terminals and in Yusen Terminals. At 450 acres and almost 2 million container lifts per year, Maher is Macquarie’s largest single terminal asset and the largest privately operated terminal on the US East Coast. Maher has served as the primary East Coast hub for carriers in the Ocean Alliance. One of those carriers, CMA CGM, has moved more of its vessel calls to the two NY-NJ marine terminals that it bought in 2022 . However, CMA CGM’s terminals do not have the capacity to also handle other Ocean Alliance carriers, including Cosco Shipping, OOCL and Evergreen Marine. CMA CGM’s New Jersey terminal will have more space once a throughput agreement with carriers in the Premier Alliance expires in 2027. Even then, Maher would need to handle some Ocean Alliance vessels, people familiar with the matter say. In addition to Ocean Alliance, Maher handles independent services from Zim and other carriers. It also serves as swing capacity for Maersk and Mediterranean Shipping Co. amid ongoing capital projects at the two terminals that serve those carriers . Maher’s talks with the PANYNJ come amid the bi-state agency’s focus on shifting costs for maintaining the port’s wharves and berths to terminal operators. While marine terminals have typically only been responsible for everything from the ground up, CMA CGM and APM Terminals, which signed a new lease in March, agreed to terms requiring them to cover costs of wharf and berth maintenance. Damage from a worm called a marine borer has rendered some of the pylons supporting the NY-NJ piers down to the diameter of a “ toothpick ,” PANYNJ Port Director Bethann Rooney told local press. The additional maintenance responsibility on the part of tenants is lengthening Maher’s lease talks due to the costs involved. Repairing damaged wharves and other maintenance could add $20 million to a terminal operator’s annual costs under a long-term lease. The alternative is spending up to $250 million to fully replace a damaged berth. With each terminal having three or four big-ship berths, a terminal operator could face up to $1 billion in replacement costs. Moreover, any berth replacement would reduce capacity at the port, requiring terminals to coordinate such projects as they occur. Contact Michael Angell at michael.angell@spglobal.com .

Macquarie looks to keep hold on NY-NJ terminal amid lease talks

<div class="phx-topic abstract-wrapper">The investigation centers on terminal service agreements that may have required container lines to commit to route a share of their cargo through Port Houston. </div>

The investigation centers on terminal service agreements that may have required container lines to commit to route a share of their cargo through Port Houston.

<div class="phx-topic">The US Federal Maritime Commission (FMC) has launched an investigation into service agreements between Port Houston and major container lines that may require some carriers to deliver a percentage of loaded containers through the largest port along the US Gulf Coast. The agency, in a filing made Friday, ordered the port and carriers to provide information and data relating to what conditions caused carriers to agree to or refuse to sign terminal service agreements with Port Houston. The FMC’s Bureau of Enforcement, Investigations and Compliance (BEIC) wants to know about previous agreements, including language on cargo commitments and details on penalties levied in instances when carriers failed to meet those obligations. The FMC also wants to determine if there were any “unreasonable, unfair, unjust, or discriminatory behaviors” related to the agreements. The agency is seeking to understand the impact the agreements had on the competitiveness and reliability of the US Gulf shipping system and whether there were any “unfair and deceptive practices” related to the agreements, according to the filing. The ocean carriers mentioned in the filing include CMA CGM, Evergreen Line, Hapag-Lloyd, Maersk Line, Mediterranean Shipping Co., Ocean Network Express (ONE) and Zim Integrated Shipping Services. The FMC said it may seek information from other ocean carriers, port authorities and other related entities. The filing didn’t specify if the percentage of loaded containers required within service agreements referred to the carriers’ Gulf networks specifically or US networks overall. Terminal service agreements generally have minimal throughput requirements in which carriers are rewarded or penalized if they exceed or fail to meet cargo obligations. Port Houston operates the Barbours Cut and the Bayport container terminals. Houston is the fifth-busiest US container port and handled approximately 71% of laden volumes moving through the Gulf region last year, according to data from PIERS, a sister company of the Journal of Commerce. Port Houston said it was reviewing the FMC order, adding that it was “confident that all agreements and practices at Port Houston are conducted in a fair, transparent and lawful manner and in alignment with FMC regulations and industry best practices.” Contact Mark Szakonyi at <a href="https://www.joc.com/article/mark.szakonyi@spglobal.com">mark.szakonyi@spglobal.com</a>. </div>

The US Federal Maritime Commission (FMC) has launched an investigation into service agreements between Port Houston and major container lines that may require some carriers to deliver a percentage of loaded containers through the largest port along the US Gulf Coast. The agency, in a filing made Friday, ordered the port and carriers to provide information and data relating to what conditions caused carriers to agree to or refuse to sign terminal service agreements with Port Houston. The FMC’s Bureau of Enforcement, Investigations and Compliance (BEIC) wants to know about previous agreements, including language on cargo commitments and details on penalties levied in instances when carriers failed to meet those obligations. The FMC also wants to determine if there were any “unreasonable, unfair, unjust, or discriminatory behaviors” related to the agreements. The agency is seeking to understand the impact the agreements had on the competitiveness and reliability of the US Gulf shipping system and whether there were any “unfair and deceptive practices” related to the agreements, according to the filing. The ocean carriers mentioned in the filing include CMA CGM, Evergreen Line, Hapag-Lloyd, Maersk Line, Mediterranean Shipping Co., Ocean Network Express (ONE) and Zim Integrated Shipping Services. The FMC said it may seek information from other ocean carriers, port authorities and other related entities. The filing didn’t specify if the percentage of loaded containers required within service agreements referred to the carriers’ Gulf networks specifically or US networks overall. Terminal service agreements generally have minimal throughput requirements in which carriers are rewarded or penalized if they exceed or fail to meet cargo obligations. Port Houston operates the Barbours Cut and the Bayport container terminals. Houston is the fifth-busiest US container port and handled approximately 71% of laden volumes moving through the Gulf region last year, according to data from PIERS, a sister company of the Journal of Commerce. Port Houston said it was reviewing the FMC order, adding that it was “confident that all agreements and practices at Port Houston are conducted in a fair, transparent and lawful manner and in alignment with FMC regulations and industry best practices.” Contact Mark Szakonyi at mark.szakonyi@spglobal.com .

Container lines

FMC probing service agreements between Port Houston, ocean carriers

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The world of LTL is slow to embrace change. Business anachronisms permeate current supply chain processes. These vestiges of the way things used to work define the LTL freight transportation procurement process of many modern shippers.David Knuth, logistics specialist at IEWC, a global supplier of cable and wire based in Wisconsin, is happy to have modernized the RFP process, automating the entire LTL bidding procedure with Bid$ense, SMC³’s automated truckload and LTL freight transportation sourcing solution. But when prompted, he can still recall what once was.In his previous job, a large part of his duties were consumed by creating an intermodal bid package for carriers. In a spreadsheet, Knuth detailed the company’s volumes lane by lane, taking care to delete any errant keystrokes or misleading data. He would then email out the information to each carrier, taking time to respond to detailed technical questions about the spreadsheet data. Finally, he had to compile all the results, create an algorithm that would compare the carriers on each lane, and award the business.“It was a huge undertaking. It took about four months to do,” Knuth said of the old process. “It was almost a full-time job for that part of the year, every year.”In his new job at IEWC, he sat down with Bid$ense on day one and was amazed at the capabilities. Knuth had never before used a bid tool. SMC³’s latest versions of Bid$ense automate the process even further, taking truckload and LTL RFPs entirely online. The tool draws on RFP best-practices protocols to streamline the bidding communication process, enabling bidding carriers to respond accurately and promptly to shipper requests. The solution also does all the distribution work automatically, electronically submitting shipper bid data to carriers based on their actual service capabilities and performance records. Carriers are alerted with timely prompts for RFP deliverables, so shippers aren’t waiting by the phone for responses.Another benefit of automating the process is the data-cleansing assistance. When Knuth sent spreadsheets to carriers, data errors might cloud the bidding process; he might have to resend data or simply accept a price that did not truly reflect the costs of doing business. Data cleansing is incredibly beneficial, he said.The spreadsheet technique also made bidding analysis an onerous task. Since Bid$ense automates and streamlines the entire RFP process, intensive examination is now simple. SMC³ knows that each bid has more than one best outcome. With uniform responses from each carrier, shippers can quickly rank results and create an unlimited quantity of what-if scenarios to make the optimal procurement decision.Jesse Burnett of Central Garden &amp; Pet experiences many of the same benefits. Founded in 1980, Central Garden &amp; Pet has spent the last three decades growing from a small garden supply company to a provider of a range of products from dog chews and bird seed to soil supplements and natural insecticides. For much of its life, the company shipped these disparate goods via LTL and truckload carriers to retailers throughout the country, relying on each business unit to negotiate directly with their freight transportation providers. This arrangement worked fairly well for a small company, but as Central Garden &amp; Pet expanded, leadership decided to consolidate decision making.Burnett helped centralize the transportation decision making in 2015 with SMC³’s Bid$ense. Before Bid$ense, every business unit operated independently as far as negotiating with carriers.“There were a lot of different things just floating around,” he said. “We didn’t have master agreements in place; no national pricing at all. The pricing from carriers was just all over the place, depending on where you were.”The transformations he saw with Bid$ense were immediate. Burnett has been using the tool about every other year since its implementation at the company. Central Garden and Pet’s $19.6 million 2019 LTL bid saved the company just more than 9 percent when compared to its historical average. For Burnett, though, bid automation extends far beyond savings.“We knew that we weren’t getting the best pricing offer from our carriers just because nothing was centralized,” he continued. “We knew that if we combined everything from all these business units and paired it with one corporate offering, then it would drive some cost benefit with it.”When the company initially decided to centralize bid procurement, executives researched a number of different methodologies and technologies. In the end, though, Burnett found that Bid$ense was both widespread and well known, and that his carrier partners already knew how to use the application. Burnett also highlighted the data-cleansing process as a major benefit, saying the rigorous process ensures that carriers always return the best price.“It definitely has helped drive savings,” he said. “Any time you go out there and you drive that competitiveness with the carriers and they know they’re in a bid environment, it seems to sharpen their pencils.”Transportation procurement is an integral part of the modern supply chain. With Bid$ense, shippers can develop a strategic implementation plan that saves them time and money, but also helps them create strong relationships with their carrier partners. These carriers appreciate the solution’s data-cleansing process; when carriers receive a complete shipment history and future volume forecast, they don’t have to guess on pricing. Carriers that receive more data from shippers get a complete picture of that shipper’s freight, allowing them to accurately plan instead of simply preparing for the worst-case scenario. Clean data presented through an automated system can lead to both bigger shipment savings and a lasting partnership between carrier and customer.Whether customers are looking to streamline over-the-road transportation bidding by automating the RFP process or create an entirely new, centralized sourcing process, Bid$ense has the analytical horsepower to get the job done.SMC³ 2020 Customer Case Study

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Shippers save money, time with automated transportation bidding tools

If there’s one immutable truth in the world of logistics, it’s this: LTL is an inherently complex form of transportation. Tariffs, rates, DIM weights, transit times — it’s enough to confuse even seasoned logistics professionals. The solution to this knowledge gap has historically been on-the-job training or university supply chain education, but for a variety of reasons there is now a pressing need for third-party, remote LTL training that prepares logistics workers for transportation success. Global Scope Can Overlook Local Intricacies In the past, professionals looking to move into a supply chain career learned about the basics of supply chain from universities. However, many of these college supply chain programs are now global in scope, focusing on worldwide supply chain management instead of the intricacies of specialized domestic transportation. And even these programs, which used to be widespread, are becoming less common. LTL is not an industry of broad-brush strokes; supply chain professionals really need a pointillistic understanding of the logistics of LTL in order to excel in the industry. Accelerating Need for Dedicated LTL Education This lack of specified training put the onus on employers to prepare new hires with the LTL knowledge needed to do their jobs. Dedicated LTL study is a necessity, not a luxury. At the same time, changes in LTL and the broader supply chain world are accelerating. The reliance on e-commerce has ballooned since the start of the pandemic, and last-mile LTL shipments and related e-commerce strains on the supply chain won’t diminish once social distancing abates. That genie isn’t going back into the bottle. So supply chain employers need logistics workers that are fully versed in all aspects of the industry, ready to solve unique shipping and delivery problems based on their extensive supply chain knowledge But why care about LTL? It’s been reported that some shippers in today’s world are no longer concerned with what mode is used to ship their goods. A Multimodal Approach Ensures On-Time Delivery This mode agnosticism means supply chain stakeholders have to be well versed in all modes of transportation. As unforeseen weather events and other disruptions, such as protests, become more common, savvy logistics employees will need to be armed with familiarity of all modes, not just the most popular, to ensure that freight is delivered on time, without damage, and in the most financially expedient way possible. Offerings like SMC³’s LTL online education courses cover a wide range of topics from LTL basics and operations to more advanced concepts like pricing analytics and transportation law. The company also has plans to continually refresh content, adding new expert presenters and taking the feedback of students to make the courses even better as time goes on. Learn more about&nbsp;<a href="https://logisticstrainingcenter.com/smc3-courses/" rel="noreferrer" class="joc_admin__link">SMC³’s LTL Online Education program</a>&nbsp;and view the 2021 hybrid schedule, featuring live industry experts,&nbsp;<a href="https://www.smc3.com/onlinelearning2021/" rel="noreferrer" class="joc_admin__link">here.</a>

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Filling the Supply Chain Education Gap with LTL Education Courses

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An in-depth analysis of transport trends in the multipurpose and heavy-lift fleet segment

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Breakbulk Quarterly

Customers scoring their intermodal partners to identify the best service providers

Intermodal Service Scorecard - Rectangle Box

Intermodal Service Scorecard

A must-attend conference for shippers & logistics providers moving goods inland

Inland Conference - Rectangle Box

Attend Inland25

A premium access index of savings using domestic intermodal vs. OTR 

ISI Report - Rectangle Box

Intermodal Savings Index

An extensive dashboard of charts organized by trade lane, mode, and topic

Gateway - Rectangle Box

Gateway

A premium access outlook critical to shippers and transportation providers

QI Report - Rectangle Box

Quarterly Intelligence

The latest port news from the Journal of Commerce spans the globe from North Carolina and Florida to Shanghai and Singapore. Port news includes port automation, terminal construction projects, the future of decarbonization and net-zero shipping, dredging, port hinterland connectivity, labor, disruption, port congestion and cargo flow.

Drayage

Port infrastructure

Breakbulk ports

Marine terminals

Longshore labor

Stay informed on port news worldwide with Journal of Commerce. From decarbonization to labor updates, get insights on global developments.

Port News | Journal of Commerce

The Journal of Commerce is the industry’s source for maritime news and analysis about ocean container shipping, logistics, supply chains, global shipping ports, shipping technology solutions and end-to-end connectivity. Coverage tracks the movement of containerized cargo — from origin to destination — handled by marine terminals in the US and abroad, depots, container ports, container lines, drayage, consignees and shippers, forwarders, non-vessel operating common carriers (NVOs) and off-dock warehousing providers, as well as pricing, capacity, volume and reliability on the trans-Pacific, Asia–Europe, North America–Caribbean, Central and South American and intra-Asia trades.

Discover comprehensive trucking news and trends with Journal of Commerce - from trucking LTL to regulation and trucking supply and demand.

Breakbulk News shipping | Journal of Commerce

Container shipping news and analysis of ocean container shipping, logistics, supply chains, technology and end-to-end connectivity.

Container Shipping News | Journal of Commerce

News and analysis of ocean containerized cargo movement, logistics, supply chains, technology, and end-to-end connectivity. Maritime news and analysis of containerized ocean cargo movement, breakbulk and roll-on and roll-off shipping from origin to destination.

Latest News

More News & Analysis

Ports fear emissions grants under threat amid EPA budget slashing

Tightening vessel supply threatens to delay offshore wind projects

Strong H1 volumes, space crunch keep Antwerp terminals under pressure